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Radio podcast. We post something new every week
and you're going to find it informative. We want
to welcome to Veterans Radio today, Rick Berman,
who is the executive director of the Ram Veterans
Foundation and the Mercer Family Foundation.
And they have something called charitiesforvets
.org that Rick's going to tell us about that
I think is really important for people to know
about. Rick, welcome to Veterans Radio. Thanks
so much, Jim. So this started, this Charities
for Vets, I think, started in 2022. Tell us,
as a veterans advocate, kind of how you got into
this and what problem you saw needed to be solved.
Well, I've had a long history of advocacy on
behalf of private interests ranging from issues
in the environmental area, labor area, financial
area, and basically what I was doing on behalf
of clients is correcting the record in terms
of public opinion. You know, there's a lot of
groups out there that have an agenda and they
say things that are untrue or they take facts
and they twist them. And so for very many years,
my job was to, as I say, correct the record and
then to put out information for the public where
they would say, oh, you know, I never thought
of it that way before. I would give people information
that made them think twice. And and I retired
from my business two and a half years ago. And
about the time I was retiring from my business,
I was familiar with these groups, these active
groups that that are always putting out information
in there. And they're collecting a lot of money.
They're scaring people with All sorts of doom
and gloom And you know contribute to our organization
and will stop all that from happening and And
so one day I was just watching television and
I saw a commercial for veteran for veterans or
I should say for donors A commercial for donors
to contribute and they were going to help veterans
And I thought to myself, you know, I've seen
so many of these groups that over promise and
under deliver. I've just wondered if that was
going on in the veteran space. And so I just
did some investigation as I had done many times
before, you know, you look up tax returns, et
cetera. And I did it for the big organizations.
And I thought, my God, there's a lot of people
here who are contributing to organizations and
they have no idea what people are doing with
their money. And Rebecca Mercer is a friend of
mine and I and she's a great philanthropist and
I went to see Rebecca and I said you ever heard
of this this problem and she said no and I said
you got any interest and she said well as a matter
of fact I have a great uncle who was killed in
France fighting the Nazis and I've always had
a warm spot in my heart for veterans and she
said you know if we can do something about that
let's do it. So between Rebecca and I We put
up a million dollars to start this organization
and that meant we had to do the research. We
had to put out information that would create
an awareness among people. We got 60 billboards
when we started out. We put them up in Times
Square and around the country and created some
videos and of course using the power of the internet
gave us an appeal to a lot of people. at the
end of the day we started to raise more money
and our goal was number one to stay focused on
veterans who were not going to have an organization
that rated charities from you know from children's
health to environment issues etc. We're just
going to stay on veterans and I was only going
to do large veteran charities. I mean there's
a lot of them out there as you know you know
you go from wounded warriors to tunnel to towers
and some of these other high profile groups.
And I said, let's just do 100 of these things.
We'll do the 100 biggest ones we can find. And
we'll put them into categories. We're going to
be very straightforward about it. We'll say,
we're going to recommend some. Then there'll
be some that are highly recommended because they're
really good. And then we're going to say, hey,
there's a bunch of charities out there that I
wouldn't give my money to and neither should
you. And I think that's the the the thing that
hooked me in finding out about charities for
vets org is like Yeah, there's and you hear about
it every year every state, you know, there are
there are scams targeted not only to veterans
but to supporters of veterans and you go like
why are you wasting your money on that scam your
hearts in the right spot your but your pocketbook
isn't and and so that's really what you were
drilling in on wasn't it yeah and and of course
i wanted people to stop giving to those to those
groups but on the other hand i didn't want to
just sit on their checkbook so that's why i said
uh i don't want you to stop giving i just want
you to redirect your giving and that's why we
have the charities, you know, about half of the
charities that we rate are in our recommended
or highly recommended category. 60 % I would
say are positive, but 40 % of the 100 are in
the not recommended category. And that doesn't
mean that a charity that's not recommended on
our list doesn't do any good work, but they typically
don't do it as efficiently as they should. Scams
are one thing, and as you say, there's plenty
of it. It's hard to see a scam though, especially
if it's a smaller one because reporting is not
that great. The Federal Trade Commission doesn't
do a good job. The Internal Revenue Service does
a terrible job. So at the end of the day, what
we end up doing is we say to people, look, this
charity here, maybe it has 90 % over it. Well,
so 10 % of their of their money is going to good
things and if you ask them, well, what have you
done? They'll give you the 10 % And you know,
we here's what we did and it sounds good until
you find out that That they're wasting a whole
lot of money on their way to that to that victory
if you will Yeah, you've got two issues here
going in trying to rate folks, right? There's
sort of the are they are they efficient? Are
their administrative costs low and are they effective?
Which do you look at or do you look at them both?
Well that's a great question. You're very prophetic
about our work. Here's what we started out with.
Efficiency is a lot easier because you're really
looking at math. I look at state fundraising
reports. I look at Their IRS of course is where
most of the information comes from and I can
tell you you know because two and two is four
all day long Just look at it you could add stuff
up and and you know people people come back to
me and they say how can you do that? you know,
how can you rate us that way and I say it's just
math and And I'm not picking winners and losers.
I'm just calling balls and strikes if you will
and you're either over the plate or you're not
so That's the efficiency that you mentioned.
Effectiveness, Jim, is very, very difficult because
there is no way to have a simple template like
you could have for efficiency. You can't just
look at someone's IRS form and see if they're
effective. So in the latter part of this year,
for the first time, I'm going to put my toe in
the water on effectiveness. And we are going
to start Coming up, I have some ideas. I don't
want to announce them as such because we may
change them along the way. But we are going to
get into the effectiveness business. Well, I
think that's excellent. The efficiency math,
if you will, and you're a guy familiar and comfortable
with numbers. is sort of black and white. And
as you say, they can call you up and complain
about the rating, but you say, look at your numbers,
it's math. And you're getting that from what
I'll call open sources, right? This is, there
are IRS form 990 and this is their tax returns
and maybe things on their own website that they
publish, maybe things that they report to the
state attorney generals. So that's all open source.
They can't be very critical. to the organization
about that, I suspect, or once they are critical,
they quickly back away. Is that what you've been
experiencing? Yeah, and of course, you can still
game the system if you're looking to do that,
if you're the charity, but we look a little tighter
at it. For instance, there's something called
joint cost accounting, where people are able
to hide their overhead by saying that what they're
doing is educating people. And without getting
into the weeds on it, we don't allow people to
spend very much money on what we'll call joint
cost of county where they're hiding their overhead.
There's always a little bit of it that goes on.
But if you're over the line as far as we're concerned,
and we do draw some lines as to how much is too
much, then we will negatively, it will downgrade
organizations. So yes, it's just math. I went
through the website and I do see that you draw
some lines about what how much should or shouldn't
be spent on Administrative overhead like that
sort of thing. Can you talk a little bit about
the lines that you draw? Yeah Well, for instance
if you on fundraising if the fundraiser is making
more money Than the charity is off of a particular
campaign. We say they're not recommended If if
you've got more than 25 percent of your budget
Devoted to overhead more than 25 percent. We
say you're not recommending And and mind you
there are charities out there where their overhead
is under 10 percent And so when I see a charity
that's got 50 percent overhead or 60 percent
over it I think you know, there's no reason that
this thing can't be managed properly and And
again, it's not necessarily a scam, but there
is a lot of people who are running these organizations
who shouldn't be running a convenience store.
They're just not that good at running a business.
And we know that's true about all sorts of institutions
where people are managing more money than they
have any knowledge of managing. So the fundraising,
the 25 % overhead, maybe you have too much money
in the bank. People are giving you money. and
you're keeping it in reserve for some rainy day.
That's what I heard somebody tell me once in
the early stages of this. He had five times his
budget in reserves. And I said, why do you have
so much money there? People are giving you the
money to spend on veterans and you're putting
it in the bank, so to speak. And he says, it's
a rainy day. It's a rainy day fund. And I said,
well, for some of these disabled veterans, it's
raining every day. So how about spending the
money? And so if you've got more than three years
worth of your budget and reserve, we will downgrade
people for that. And that may be, I just hinted
at something that may be the most important fact.
If you look at other rating agencies, there are
some other rating agencies out there that rate
charities of every kind. Now, of course, we're
just doing veterans, and we're only doing 100
veterans, veteran charities. But what they do
is that they they grade these organizations whatever
whatever kind of organization they're grading
there's an there's an averaging component to
their algorithm so if you're good in one area
and you're bad in another area they average it
out by some some formula that they have and so
now you get a middling grade you got an a here
and an f here so you get a c now you're sounding
like my high school geometry teacher here yeah
yeah exactly so i mean And everybody's familiar
with that. You know, you do one area, you do
another. Well, with us, we decided that that
wasn't the way to go. If we had these main factors
and if somebody's got excessive overhead, but
they're good in all these other areas, we're
not going to average it. We're going to say if
you got excessive overhead, you fail. And so.
We have a pass fail system for every one of the
factors that we use in our judging. And if you
fail in any one of those factors, you hit the
not recommended category. So we're talking to
Rick Berman who's the executive director of for
Ram Veterans Foundation which is spearheading
with the Mercer Family Foundation a interesting
website called charities for vets org that ranks
the top hundred veteran focused charities in
the country and One of the things that I also
liked not only is that you draw lines but you're
willing to say, you know, name names, if you
will. Hey, here's the recommended, here's the
not recommended. You actually have a screen that
says examples of waste and abuse. And when I'm
looking at these, one of the things that sort
of comes to my mind is there's a lot of similarity
in names or confusing names where I think I'm
doing a national organization, maybe, you know,
one of the VSOs, Veterans Service Organizations,
but I'm thinking, I bet there's somebody else.
Have you bumped into that, that some of this
is name confusion as to which charity I'm giving
to? You know, absolutely. And, you know, a lot
of the people who give the charities are older
people and it's easy for them to get screwed
up by thinking that they're given to one and
they're actually given to another. The brand
confusion is rampant. Actually, you can see some
of that on our website. But, you know, I once
looked up, this is a year or two ago, I once
looked up how many organizations had wounded
warriors in their name. And there were 57 organizations
that had wounded warriors in their name. Could
be wounded warriors of Detroit or a lot of variations.
So sure, you're right on that one, Jim. No, I
was searching for the right word, but you used
it. It's brand confusion. It's, geez, is the
Disabled Veterans National Foundation, which
is on your list of examples of waste and abuse,
is that DAV? I read it again. I said, well, that's
not DAV. I mean, it's easy for even those paying
attention to get confused, the Purple Heart Veterans
Foundation. I don't think that's the Purple Heart
Legion. I think that's something else, you know.
So you've done a hundred of these and there are
probably thousands because your criteria was
what, two million or something in annual giving
or receiving? It's now three million, three million
or more. Okay. There's so many small ones. It's
ridiculous. Yeah. What advice do you give folks
who go, well, I don't see this on your list,
but that doesn't mean anything other than it's
not big enough to get rated. That's right. And,
and, and I might've even missed some big ones,
you know, every so often we'll find one that
we didn't know existed. But, uh, but that's the
problem. Uh, someone told me once they had done
the, they had done the research and that there
were 45 ,000 veterans organizations. or organization
with veterans in their name. That doesn't surprise
me. That number is a shocking number, but I go,
yeah, probably. Yeah, and a lot of them are these
mom and pop operations. And people with a good
heart, I'm not saying everybody does this for
criminal reasons. People with a good heart, they
start one of these. In fact, I get a lot of people
from these small ones who ask if we would please
rate them because we're doing a lot of advertising
and they'd like to be on our website. And I tell
them, look, I don't have the bandwidth to go
after all these groups. I want to just go after
the ones that are big enough to be making a difference.
Well, and I see some of these that you've rated,
you know, combined and it's probably a marketer's
dream, right? Let's combine veterans and dogs.
That's everybody likes that. And you've got a
few of those like, Hey, they're the lines we
draw that some of these aren't good because they've
got too much spend too much here or there notwithstanding
they're plucking two of your heartstrings dogs
and veterans you got it yeah there are there
are several service dogs that organizations for
veterans yep did as you went through and you
do this and continue to refine it what has surprised
you um Well, in a positive way, one of the things
that surprised me is that some people have called
me up after we, you know, they discovered that
we're rating them and we're rating them poorly.
They've said, OK, we understand why you rated
us poorly. And we think that we could probably
change the way we do business. And we'd like
to get into a different category of recommended.
And I say, you know, one of the things that we
have, it's a signature of our group, is that
I will take any appeal. any reasonable appeal.
And if you make that case, we will in fact change
the ratings. And so I've actually done that two
or three times. So that was a good thing. It
surprised me that people were willing and supposed
to just getting nasty about it. The flip side
of that is that there have been some very nasty
people who have been angry over the fact that
we rated them the way that we did. And I said,
look, that goes back to what we talked about
earlier. I said, look, it's just math. And they'll
say, well, you're looking at it incorrectly.
There are some people who say overhead should
not be a factor. I say, well, you can make that
case if you want to. But if you're wasting money,
that's the first place I'm going to see it is
overhead. And if you want to make the case, someone
will say, well, we have to pay excessive salaries
to get good people. I say, That's not the case.
I mean, I'm doing this for free. I don't, I don't
take a salary. There are people who will do that.
And then there are people who are getting $500
,000 a year. Well, if you're getting, you know,
six figure salaries, you're going to have high
overhead unless you've got really high revenues.
And if you think the only way you can run this
is with very expensive staff. Well, it's your
choice, but I'm going to report it as such. Yeah,
absolutely. And particularly all of those small.
sureties in that 45 ,000 number or so there's
plenty of them that are 100 % volunteer that
that you know every I don't they don't collect
more than 40 50 100 200 grand a year but it all
goes right back out the door so when you get
just because you got big doesn't mean you get
to be live lavishly right right I mean you know
fancy office buildings I mean there's a lot of
ways to spend money So, Rick, as you go forward
here and you're kind of going to dip your toe
into effectiveness, that'll be an interesting
challenge. And when you get that up and running,
we'd love to talk to you about that, sort of
how you set the bar, how you may make some of
these determinations. But as we wrap up here,
what advice would you give not only veterans,
but friends of veterans who are donating to these
causes? What advice would you give them before
they write that check? Well, of course not everybody
has the capacity to do their own research so
I would like them to say At least if they're
thinking of a charity that we are already great
To just go to our website, you know, that's another
that's another distinguishing feature is that
our ratings are for free There's no fee. There's
no subscription you just get on the internet
and there it is and we're updating it on a very
regular basis so I would say Go to our website
and see if it's there. Now, some people have
called me up or emailed me and say, could you
please rate this charity for me? And it's not
on our list. And I typically say, look, here's
how you rate it. And sometimes if I've got nothing
better to do with my time, which is not too often,
I will look at a charity and just do a superficial
rating. And I'll just go back and say, well,
they look like they're pretty decent people.
Or otherwise. So there's not much I can tell
people. I'm not going to tell people to go and
do their own research on the, you know, with
tax returns, because if you can read a tax return,
you don't need my advice to tell you to go find
it. No, for most people that we don't have the
time, we don't have the expertise, the patience
to do all the homework. That's why Charitiesforvets
.org is so important. I want to thank Rick Berman
for his time today and for the good work that
Ram Veterans Foundation and Mercer Family Foundation
are funding through this effort. Rick, I really
appreciate you explaining this to us today. Jim,
it's been my pleasure. And I want to thank everybody
for listening to Veterans Radio today. I am Jim
Fawzone. It's been a pleasure to be your host.
I'm a veterans disability lawyer at Legal Help
for Veterans and you can reach us at 800 -693
-4800 or legalhelpforveterans .com on the web.
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